Competitive Intelligence

Competitive intelligence is the action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors, and any aspect of the environment needed to support executives and managers making strategic decisions for an organization.

Competitive intelligence essentially means understanding and learning what is happening in the world outside the business so one can be as competitive as possible. It means learning as much as possible, as soon as possible, about one's industry in general, one's competitors, or even one's county's particular zoning rules. In short, it empowers anticipating and facing challenges head on.

Key points of this definition:

A more focused definition of CI regards it as the organizational function responsible for the early identification of risks and opportunities in the market before they become obvious. Experts also call this process the early signal analysis. This definition focuses attention on the difference between dissemination of widely available factual information (such as market statistics, financial reports, newspaper clippings) performed by functions such as libraries and information centers, and competitive intelligence which is a perspective on developments and events aimed at yielding a competitive edge.

The term CI is often viewed as synonymous with competitor analysis, but competitive intelligence is more than analyzing competitors: it is about making the organization more competitive relative to its entire environment and stakeholders: customers, competitors, distributors, technologies, and macroeconomic data.

The literature associated with the field of competitive intelligence is best exemplified by the detailed bibliographies that were published in the Society of Competitive Intelligence Professionals' refereed academic journal called The Journal of Competitive Intelligence and Management. Although elements of organizational intelligence collection have been a part of business for many years, the history of competitive intelligence arguably began in the U.S. in the 1970s, although the literature on the field pre-dates this time by at least several decades. In 1980, Michael Porter published the study Competitive-Strategy: Techniques for Analyzing Industries and Competitors which is widely viewed as the foundation of modern competitive intelligence. This has since been extended most notably by the pair of Craig Fleisher and Babette Bensoussan, who through several popular books on competitive analysis have added 48 commonly applied competitive intelligence analysis techniques to the practitioner's tool box. In 1985, Leonard Fuld published his best selling book dedicated to competitor intelligence. However, the institutionalization of CI as a formal activity among American corporations can be traced to 1988, when Ben and Tamar Gilad published the first organizational model of a formal corporate CI function, which was then adopted widely by US companies. The first professional certification program (CIP) was created in 1996 with the establishment of The Fuld-Gilad-Herring Academy of Competitive Intelligence in Cambridge, Massachusetts.

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